The Australian government has unveiled a new set of rules in its push to secure the natural gas supply for the domestic market.
In a joint statement by the treasurer Josh Frydenberg and the minister of energy and emissions reduction, Angus Taylor, noted that the new measures build on previous actions introduced in 2017.
Both Frydenberg and Taylor said that previous measures pushed the spot price of gas in eastern Australia has fallen by more than 25 per cent and gas contract offers have fallen by up to 50 per cent.
Under the new measures, the government intends to bring forward the scheduled review of the Australian Domestic Gas Security Mechanism (ADGSM) to this year. A review was scheduled for next year but given major changes in global gas markets over the past 6 months, the government has decided to bring this review forward.
The review will assess if the ADGSM is still fit for purpose to deliver a functional domestic gas market with the lowest possible prices for consumers while ensuring strong investment in new gas production.
Second, the Government will consider options to establish a prospective national gas reservation scheme.
Past approvals of large gas export projects have not adequately considered the impact on the domestic gas market and that has contributed to some of the pressures we have seen in recent years. We cannot afford to repeat these past mistakes, the statement reads.
Third, the government will increase transparency and supply in the gas market. This includes continuing reforms through the COAG Energy Council requiring improved transparency from gas producers and LNG exporters on prices, reserves and resources, and a comprehensive review of pipeline regulation.
The statement reads that consultation on the reforms is to take place over August and September.
The government has set sights on working extending the Australian Competition and Consumer Commission’s (ACCC) role in monitoring and publishing data on the gas market in Australia until December 2025. It will also engage with LNG plants to explore whether some of their processes could be electrified, freeing up more gas for domestic use, among others.